Will the crisis be good for Greece?

Guest Post: July 2012

For several decades, Greece has topped the lists of Europe's ten most visited countries. According to the Greek National Tourist Association, the number of visitors that travel to Greece every year exceeds 19 million, a figure that is particularly high for a country of just 10 million inhabitants. Athens and the Greek islands attract the highest number of tourists, with Athens alone receiving more than 6 million visitors a year.

The financial crisis

Revenues generated by tourism are incredibly important to Greece's economy. It is estimated that as much as 20 per cent of the country's GDP comes from tourism. Following the 2004 Olympics, the Greek Ministry For Tourism expected to increase that percentage to 40 per cent. However, the subsequent financial crisis seemed to put a halt to those expectations. Since 2009, the number of tourists to Greece has been steadily decreasing, and so has the average daily tourist expenditure, which has gone from €69.7 in 2005 to €57.3 in 2011. These figures are a cause of concern to a country that depends so heavily on tourism.

Impact on tourism

Foreign tourists also wonder to which extent will the financial crisis impact on the quality and cost of their Greek holidays. Continued political unrest and violent demonstrations have made some tourists reconsider travelling to Greece. On the contrary, others claim that the crisis will help bring the prices down and that it will be beneficial to foreign tourists who plan to visit Greece. What version are we to believe?

Understanding the impact of the financial crisis on Greek tourism

In order to ascertain the real impact of the economic crisis, it is important to have a more detailed appreciation of the figures involved. According to the Greek National Statistics Agency, approximately 66 per cent of all visitors to Greece originate from European Union countries. Greece received more British tourists than any other nationality, with 15 per cent of the total number of tourists being from the UK. The second largest group is made up by Germans.

Generally speaking, the UK and Germany have not been affected by the crisis as much as other European countries. However, some German tourists believe that there is a general anti-German sentiment in Greece, and the number of German tourists in Greece has shrunk by 40 per cent.

Popular world wide

Although there has been a decline in the number of European visitors, it seems that Greece is attracting higher numbers of tourists from other parts of the world. Greece receives large numbers of US visitors, and it was voted by the Chinese as the number one tourist destination. The number of Russian, Israeli, and Turkish tourists is also on the rise. These facts could counterbalance the dwindling revenues generated by European tourism.

It is also worth echoing a statement made by the President of the Hotel Association in Laganas (Zakynthos), one of the most popular holiday destinations. She affirmed that what happens in Athens is not representative of what happens in the rest of the country. Life in the islands goes on virtually undisturbed, and there have been no disruptions at ports or airports since the end of 2011.

Greek National Statistics Agency continue to shuttle tourists between the UK and Greece. If anything, hotels and restaurants are quieter than before the crisis (which is not necessarily a bad thing!). In an attempt to attract customers, businesses are dropping their prices and even offering some services for free.

To sum up, Greece remains a fascinating country to visit. While the crisis is undoubtedly affecting the tourist sector, and regardless of whether Greece stays within the Eurozone or not, visitors from countries who use a currency different to the Euro can still benefit from the country's economic situation.